Activist investor Trian Fund Management made an opening bid to gain four board seats at DuPont, setting the stage for a potential break up of the top US chemical-maker by value.

Trian nominated its co-founder and chief executive Nelson Peltz as a DuPont director. Also nominated are John H Myers, a former chief executive of GE Asset Management; Arthur B Winkleblack, former chief financial officer at HJ Heinz; and Robert J Zatta, acting chief executive at chemical-maker Rockwood Holdings.

The firm has said DuPont, the maker of everything from genetically modified seeds to solar-panel materials, has $4 billion (€3.37bn) of excess corporate costs and should be broken up to unlock shareholder value.

Trian wants Dupont to be split into two companies, one that is faster-growing with units such as agriculture, and a second with more cyclical businesses.

Frustration

Trian first bought a stake in DuPont in the second quarter of 2013 and presented a performance assessment to the board in July of that year. The so-called white paper was disclosed in September as Trian made public its frustration with DuPont’s management.

The firm argues that a management team overwhelmed by bureaucracy and organisational complexity can’t effectively run DuPont. The company has either missed or lowered its earnings guidance for three straight years.

“We can’t sit idle any longer while the company continues to miss their numbers,” Trian co-founder Ed Garden said. “We feel like we have bent over backward trying to be patient.”

DuPont chairwoman and chief executive Ellen Kullman has rebuffed Trian’s overtures and has defended the company’s conglomerate structure, while at the same time cutting costs and unveiling a plan to spin off its performance-chemicals business – renamed The Chemours Co – in mid-2015. – (Bloomberg)